Who Needs a New Business Entity?
Sole proprietors and the self employed don’t have multiple owner issues, but they do lack limited liability and special business tax breaks. Lack of limited liability is often a major threat to the business owner. There are six entities or groups that businesses deal with, and any one of them is a potential threat to sue the business. These groups are: customers, employees, creditors, sub-contractors or contractors, competitors, and regulatory governmental agencies. If you deal with any combination of these groups as a proprietorship or through self employment, as a licensed professional or as the general partner of a partnership, you are a candidate for a formal business entity. Your status as proprietor, self employed or general partner provides no limited liability at all. You may be in great personal danger from business related lawsuits. Also, you may have mismanaged an existing business entity to the extent that your limited liability is in jeopardy or is non-existent. If so you
